As computers become more indispensable, computer consulting
becomes more profitable.

Every day, computers become faster and more sophisticated.
Unfortunately, computer users do not. Throughout the history of
computing, these truths have remained painfully self-evident:
Computer technology progresses at breakneck speed, while the people
who use computers break their necks trying to keep up.

Perhaps that's why computer consultants continue to be in
high demand, despite a relative flourishing of computer literacy
among businesspeople. As computers have become more indispensable
in the workplace, the need for high-tech expertise has only
intensified. Consultants who can set up complex information
systems, troubleshoot office networks, train business owners on
Internet usage, or provide teams of programmers for short-term
assignments (to name but a few consulting concepts) face a massive
market.

According to the U.S. Department of Commerce, computer
programming, data processing and other computer-related services
brought in a whopping $114 billion in revenues in 1993, the last
year for which figures are available. Between 1988 and 1993,
computer-service revenues grew nearly 60 percent, up from just
$67.7 billion in 1988.

Computer consulting is a competitive field, but it's also
flexible. Successful consultants may operate as staffing services,
which are similar to temporary help firms; as individual "guns
for hire;" or as subcontractors to other firms. Start-up costs
for a solo business can be downright meager: Consultants who work
on-site for clients sometimes plug in without buying equipment or
outfitting an office. Even when your aspirations are loftier,
capital requirements are not especially intense. Talent, more than
tooling, seems to determine business success.

Gayle Sato Stodder covers entrepreneurship for various
publications. She lives and works in Manhattan Beach,
California.

Sufficient Memory

In today's consulting marketplace, the primary talents
you'll need are marketing savvy, business skills and access to
cutting-edge technological abilities (yours or your staff's).
In the old days, computer consultants could be generalists,
coaching clients on the distinction between hard drives and
floppies, or training them in the basics of word processing. Now,
more businesspeople are computer literate and are handling the
functions consultants used to handle. Consultants, in turn, are
called on for more complicated work-custom programming, for
example.

If higher skill thresholds put greater demands on consultants,
they also put consultants in greater demand. John Hammerbeck, owner
and president of The Systems Group Inc., a data processing,
contracting and consulting firm in Dallas, says even large
corporations have trouble keeping pace with progress.
"It's impossible for one company to maintain the staff
they need to deal with new projects and technologies," says
Hammerbeck. "It's easier to bring consultants in than it
is to keep all the qualified people they need on staff."

Providing qualified personnel is the core of every consulting
business. But the ways firms maintain their talent varies
widely.

The simplest consultancies involve solo subcontractors.
Subcontractors work with established consultants, who provide
contacts and contracts in exchange for a percentage of the
subcontractor's fee.

Though it has its limitations, subcontracting can be a low-cost,
low-risk way of going into business. "If your main goal is a
steady flow of income, you can stick strictly to
subcontracting," says Ricki Letowt, owner of Letowt Associates
Inc. in Norwalk, Connecticut, who began consulting as a
subcontractor in the early 1980s. For technical wizards who lack
the marketing gene, subcontracting can be ideal.

For true entrepreneurial types, going independent may be a more
rewarding choice. Like subcontractors, solo consultants do their
own technical work. But they also handle the "business
end" of running a business-client development, cash flow,
strategic planning and so on.

Some solo operators find that one person-and one area of
expertise-can't cover it all. Letowt, for example, has clients
who want computer networks set up. Since that's not her
speciality, Letowt acts as a broker between other consultants and
her clients, and receives a percentage of the revenues-thereby
maximizing her sales and her value as a client resource.

What if you're more business-oriented than technologically
inclined? Then consider following Dominic Schilt's lead. In
1988, Schilt co-founded DHS & Associates Inc., a systems
integration and information systems consulting firm in Rosemont,
Illinois. Though Schilt knew enough about technology to understand
his markets-and even to take on a few early assignments himself-his
plan was to build a team of consultants he could oversee and
develop.

On this scale, says Schilt, "the most important thing is
understanding the business of business. I have a good, strong
business sense and a sales background, which has helped. I'm
not certain that technical knowledge is as important, for example,
as understanding cash flow."

The Right Application

Finding the right business format is a fundamental challenge for
new consultants. Another is finding the right specialty. Thanks to
the proliferation of technology, the range of potential specialties
is enormous; network design, desktop publishing, and Internet
training are just a few examples.

Established consultants make two unanimous observations. First,
it's essential to stay on top of your specialty. Unless you
provide the latest information and applications, your assistance
isn't worth much. Second, be prepared to change with the
market. Schilt, for instance, had to re-engineer his firm just a
few years after start-up. "The case technology we had been
focusing on was being replaced by client-server systems,"
Schilt explains. "We had to invest a significant amount of
money to adapt to that change. It was a challenge, but one that
allowed us to stay ahead of the market."

Reality Bytes

No matter what size or shape a consultancy takes, marketing
plays a major role in its success. In this field, advertising in
the Yellow Pages or the local paper simply won't bring in the
business. Most successful consultants and consulting firms do
aggressive face-to-face marketing.

Letowt credits networking with the success of her business.
"My first year in business, I went to meetings of every
organization I could think of," she says. "Anyone who
came within 3 feet of me got a business card. You have to let
everyone know what you do."

Assuming you're in the right market-with the right
specialty, the right infrastructure and the right approach-even a
new consultant stands a good chance of success in this field. That
isn't because this is an easy business to master. Rather,
it's an easy service to justify.

"Today, all companies want to gain a competitive
edge," says Schilt. "To most people, that means
technology." Staying on the leading edge of computerization is
hard. Selling the leading edge isn't.